Although President Trump’s pro-tariff positions receive all the attention, a little-noticed executive appointment may be nearly as important. Makan Delrahim [MAAKIN DEL-RA-HEEM], Trump’s hand picked leader of the antitrust division at the Department of Justice, is working hard to ensure more competition domestically. This move put many Silicon Valley monopolies on edge.
Small businesses create far more jobs than “big business” does, a fact lost on the pre-Trump Republican Party. President George W. Bush pursued policies favorable to big business and it all cratered in 2008, handling the election to Obama.
Once the home of countless tech start-ups, Silicon Valley has devolved into a two-tier society of haves and have-nots, and little real competition. A mere handful of giant companies like Apple, Facebook, and Google have exploited the H-1B visa program and failed to compete with each other for labor, such that salaries have not kept up with the cost of living there.
The latest average salary increase of tech workers in Silicon Valley — the region between San Francisco and San Jose that is the birthplace of many familiar technology behemoths — is only 0.4% per year. That’s because there’s no real competition — only large companies that fight to maintain the status quo with themselves on top.
The cost of living goes up, but real wages do not. The result is a large homeless population of people who simply cannot earn enough, even working multiple jobs, to afford housing. Monopolies interfere with a healthy distribution of wealth, creating enormous disparities more familiar in countries like Mexico, where a few people control much of the property.
Big companies rarely innovate, and in fact often stifle inventions that threaten their dominance. The largest Silicon Valley companies have been most responsible for changing our patent system from one that rewarded the inventor to one that favors big business.
Trump’s outspoken criticism of Amazon.com has led others in his Administration and the Republican Party to look more critically at Silicon Valley monopolies like Facebook. The scrutiny is long overdue, and some antitrust enforcement may be just what the doctor ordered.